sebi:WTM/RKA/EFD-DRA-III/45/2016
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Facts / Headnote
Show cause notice dated June 01, 2015 disposed of; no directions issued under regulation 44 as noticee had already made public announcement at a price higher than the price calculated under the Takeover Regulations, 1997 and the prevailing market price.
Provisions invoked
- s. 24
Regulations
- Reg. 6
- Reg. 11
- Reg. 10
- Reg. 12
- Reg. 14
- Reg. 14(1)
- Reg. 44
- Reg. 11(1)
- Reg. 20
- Reg. 20(4)
- Reg. 20(5)
- Reg. 32
- Reg. 20(7)
- Reg. 35(2)(b)
Parties
- Mr. Manoranjan Roy
Holding
The noticee, Mr. Manoranjan Roy, was found to have breached regulations 10 and 11(1) of the Takeover Regulations, 1997 by failing to make public announcements within the prescribed time after acquisitions on August 01, 2011 and August 05, 2011. However, since the noticee had already made a public announcement on January 25, 2016 at a price higher than the price calculated under the Takeover Regulations, 1997 and the prevailing market price, the show cause notice was disposed of without issuing directions under regulation 44.
Full text
_____________________________________________________________________________ Order in the matter of Sarang Viniyog Ltd. Page 2 of 10 05/08/2011 Bubna Properties Pvt. Ltd. 490000 4.89 05/08/2011 Dream Commosale Pvt. Ltd. 450000 4.49 05/08/2011 Total 1400000 13.97 31/12/2011 Debendra Modi 1000 0.01 31/12/2011 Nawal Kishore Singh 1000 0.01 31/12/2011 Total 2000 0.02
_____________________________________________________________________________ Order in the matter of Sarang Viniyog Ltd. Page 3 of 10 Takeovers) Regulations, 1997 (hereinafter referred to as “ the takeover Regulations,1997') read with the corresponding provisions of regulations 32 and 35 of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (hereinafter referred to as “Takeover Regulations, 2011”) should not be issued against him.
_____________________________________________________________________________ Order in the matter of Sarang Viniyog Ltd. Page 4 of 10 October 23, 2015 at BSE was `79.20/-. (b) The target company had allotted bonus shares to all its shareholders on October 10, 2015 (Record Date). The open offer price as per the formula including interest @ 10% per annum will come to `4.49/- approx. (`3/- offer price, as there was no trading in Calcutta Stock Exchange + `1.49/- as interest @ 10% p.a. since August 01, 2011). (c) The share price of the target company had never come below `34 (unadjusted `68) in last one year. The share price of the target company had touched the peak of `119.50 (unadjusted `239) on August 21, 2015. (d) If SEBI pricing formula (as applicable to infrequently traded shares) is applied to the target company’s shares, even then the offer price would remain between `4/- and `5 including interest component as per erstwhile the Takeover Regulations, 1997. (e) Thus, the open offer price would be far less than the current market price and no public shareholder may tender his/her share at such lower price. This will unnecessarily result in wasteful expenditure in paying substantial fees to merchant bankers and other professionals as also advertisement costs, etc.
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Source: SecMarx — sebi:WTM/RKA/EFD-DRA-III/45/2016. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.